According to a new study released by BMO Bank of Montreal, while the majority of Canadians would like to improve their financial standing, many admit that bad spending and savings habits and an unwillingness to make sacrifices are keeping them from doing so.
The poll, conducted by Pollara, revealed:
The vast majority of Canadians (88 per cent) would like to improve their financial standing; however, more than one-quarter (27 per cent) do not know where to start. More than one third (38 per cent) say they have developed bad spending and savings habits that are negatively affecting their finances, while another 31 per cent are not willing to give up the things they enjoy to improve their financial standing.
Thirty-six per cent regret past financial decisions, 17 per cent have felt ashamed or embarrassed by their money situation and 13 per cent have avoided looking at financial statements or bills.
“Without healthy routines it’s easy for people to develop a negative relationship with their financial situation, but that doesn’t mean there aren’t ways to change things for the better,” said Christine Canning, Head, Everyday Banking, BMO Bank of Montreal. “Start by taking small, deliberate steps to reverse bad spending or savings habits to begin building positive momentum. Then, put strategies in place to help you stick to the program.”
Impulse Purchases, Over Spending and Lack of Self Control Top the List of Canadians Financial Regrets
Of those carrying financial regret, spending outside their means tops the list at 37 per cent. Furthermore:
One third (34 per cent) regret not using more self-control with their finances, including making unnecessary or impulse purchases (36 per cent).
Another 25 per cent say their past spending habits have led them into debt.
One in five (20 per cent) regret purchases that prevented them from putting funds toward savings and debt.
According to the BMO Household Savings Report released in April, more Canadians are making saving a habit by using a fixed savings plan that includes monthly contributions. In fact, one-in-three Canadians (31 per cent) have a fixed savings plan in place heading into 2015, a year-over-year increase of 19 per cent.
“It’s important that Canadians set financial goals for themselves and establish behaviours that will help achieve them,” noted Ms. Canning. “Working with a financial planner who can help build a comprehensive household budget is a good first step toward getting spending and savings habits on track.”
Ms. Canning added that BMO recently launched the BMO Savings Builder Account, which offers Canadians an industry-leading rate of 1.3 per cent when they increase their savings by $200 or more each month. The account helps Canadians get into the habit of saving, whether for a down payment on a home, a child’s education or for a rainy day.